Buying & Selling Tips

Buying

Why use your hard-earned cash to pay the landlord’s mortgage when you could be using the rent money to buy a home of your own? That’s a question many people ask themselves when they start thinking about moving out of the rental market to home ownership.

It’s a big step. For most people, taking out a mortgage is the biggest financial commitment they will ever make. But buying your own home has always made sound financial sense. Here are some facts to think over when considering home ownership as opposed to renting.

If you are 35 now and just buying your first home, you will likely be mortgage-free when you are 60 and sitting comfortably on a considerable asset.

It’s highly likely your investment will appreciate considerably in 25 years. It’s important, however, not to buy with the intention of making a quick fortune. Think of home buying as a sound, long-term investment.

Buying a home is a very effective way of saving regularly over many years. Even if you never buy into another retirement or investment plan, you are effectively putting money away for the future.

Owning a home of your own means you and your family can set down roots, get to know your community and involve yourselves in it.

Discover the pride of home ownership. You can fix the place to suit your particular needs. You can also have pets in your home.

As your family grows and moves on to homes of their own, you will have the option of earning extra income by renting out spare rooms or floors, if local bylaws allow.

If you are planning to borrow money from a bank or other financial institution, owning your own home is a definite plus when it comes time to negotiate.

You may not need as much money as you think to get into the home market. Qualified buyers can buy a house with as little as five per cent down through the Canada Mortgage and Housing Corporation’s (CMHC) mortgage insurance scheme. You may also be able to use RRSP funds as part of your down payment.

With many kinds of investments, you have to pay a capital gains tax on profit you make. If your home is your principal residence, this tax does not apply.

After you have carefully considered all of the aspects of home ownership and are ready to begin your search, it’s time to contact your REALTOR®. He or she has access to the Multiple Listing Service® (MLS®), a co-operative marketing system through which properties are bought and sold. Using the MLS®, your REALTOR® can prepare a customized list of properties for sale that best meet your needs, wants and budget. Your REALTOR® will also provide valuable assistance and guidance to you throughout the buying process.

Selling

When your home is for sale, it’s often more than just the purchase price and location that will make or break a deal. Making your home look its very best and presenting it as a desirable place to live are also very important.

Work with your REALTOR®

Your REALTOR® can give you an objective opinion of what you need to do. REALTORS® have the experience and knowledge that can help identify problem areas or suggest improvements. In most cases, REALTORS® will not suggest major renovations. A few minor repairs here and there and a thorough cleaning are usually all that are required.

Cleaning up the homestead

Virtually all buyers are on the lookout for one thing — a clean home. Many will simply walk away if a home looks uncared for and, at the very least, an untidy home will fetch a lower selling price. Ensure your home is spotless and free of clutter. The two most important rooms in a buyer’s mind are the kitchen and the bathroom. Pay particular attention to these areas — they should sparkle and shine.

Making repairs

There are certain items that must be repaired if there are problems. A leaky roof, for example, must be fixed. Any electrical problems will have to be addressed. Furnaces, water heaters and plumbing also fall into this category.

Other areas may not need major repairs but will need attention. These can include leaky faucets, holes in window screens and any broken glass, etc. If some of your walls are too dirty to come clean, you may wish to consider a paint job. Carpets and rugs should also be clean and in good repair.

Outside and in

Take a close look at the state of your yard. If you are showing your home in the summer, trees and shrubs should be pruned and your lawn kept neat. In the fall, rake leaves regularly and in the winter ensure the walks and driveway are kept clear of any snow or ice.

To renovate or not to renovate

Usually, most renovations do not translate into an increase in selling price of more than the cost of the renovations themselves. Painting, wallpapering and modest landscape improvements usually recover their costs, but major projects such as new patios, decks or additions rarely do.

Moving up or down

If you are selling your home because you need more space with a growing family, or if you plan on downsizing now that the kids have left home or you want less work, your REALTOR® can help. With access to the Multiple Listing Service® (MLS®) your REALTOR® can provide you with list of homes for sale that meet your needs and your budget. If you have access to the Internet you can view all of the properties listed for sale on the Board’s MLS® system by logging on to www.mls.ca.